Local cannabis advocates are hailing Colorado’s 2019 legislative session as a milestone for the burgeoning industry, but the specifics of the 13 cannabis-related bills that passed still remain murky.
“By far this was the most productive year for cannabis, not only for the industry, but also the patients and caregivers,” Jason Warf, executive director of the Southern Colorado Cannabis Council, told about 20 members of the public who attended a June 19 meeting at Penrose Library.
Legislators passed a bill that would open up the state’s $1.5 billion-a-year cannabis industry to outside investors such as publicly held companies and large venture funds, which will inject some much-needed capital into the industry, Warf said.
“Bringing in capital has been a challenge that we’ve not been able to tackle yet, and finally we’re there,” Warf said.
The regulations that previously blocked publicly traded companies from participating in the market have hamstrung Colorado, an early leader in cannabis legalization, attorney Cliff Black said.
“The publicly traded company bill is very important because it’s going to bring a lot of financial resources into this industry where Colorado has really been held back on being able to expand,” Black said. “It’s an exciting bill.”
The Southern Colorado Cannabis Council’s role does not end at advocacy, Warf said. The organization will work with the Colorado Department of Revenue and the Marijuana Working Group during the rule-making process.
“One thing that everybody needs to realize is that these bills give us really good guidance and provide some framework of how this is going to look, but what we learned in the beginning of the marijuana industry is, this regulation is subject to change,” Black said. “New rules will be added, local governments will add their rules, and there will be different interpretations of these rules from different licensing officials.”
Starting Jan. 1, 2020, medical marijuana dispensaries that have applied for a license can begin delivering medical cannabis from their stores or any commonly owned store, Black said.
“So if the same company owned two or three dispensaries, that delivery license would be good for all those stores, but they couldn’t go deliver for other stores in town,” Black said.
Retail marijuana dispensaries can follow suit in 2021. Also eligible for delivery licenses are transportation companies that cultivate no cannabis products on their own, Black said.
“That would allow a company that doesn’t cultivate, doesn’t have a store, doesn’t produce infused products, but they could be just a delivery company,” he said. “It would be very similar to creating a company like Uber Eats or Grubhub.”
Delivery companies will be subject to many of the same rules as brick-and-mortar dispensaries. Patrons will have to show acceptable forms of identification, which the driver will verify, and companies can deliver only one ounce per residence each day. Delivery to publicly owned property such as hotels or schools will not be allowed.
“So if you have a residence where four adults lived and each one wanted to put in an order and get their own ounce, that probably wouldn’t be allowed,” Black said. “Even if somebody has an extended ounce count and can have four ounces, you’re only going to be able to deliver one ounce [and] one delivery a day to that residence.”
County and municipal governments can decide not only whether to ban delivery, but also to prohibit companies in other municipalities from delivering within their jurisdiction, Black said. Additionally, drivers cannot load any product onto their vehicle until an order has been placed.
“One of the initial concerns my clients had is [that] a store in Denver will be able to load two pounds of marijuana onto their vehicle, drive down to Colorado Springs and sit in a park and wait for the order to come through,” Black said. “They can’t — they can only load that up once it’s been placed at the store, and then drive down and deliver it.”
Now that cannabis is officially exempt from Colorado’s Clean Indoor Air act, the state can begin handing out licenses to “consumption clubs” starting Jan. 1, 2020. These establishments can operate under one of two models — hospitality, or hospitality and sales.
A hospitality establishment — which is similar to a “BYOB” bar in that it does not provide cannabis — can set up shop in a brick-and-mortar store or a mobile location, though the latter would be heavily regulated, Black said.
“You have to have a route planned out, submit a manifesto on what your route is going to be and where you’re going to stop,” he said. “[The mobile locations] can’t have visibility from the outside, so you would have to have dark, tinted windows and follow the open container law — the driver would probably have to be protected from any secondhand smoke.”
Hospitality and sales establishments, which can only be brick-and-mortar, would be allowed to provide small amounts of marijuana for on-site consumption. The Springs’ two licensed cannabis clubs must re-apply by Dec. 31, and can continue to operate until they are officially approved or later denied.
“If somebody doesn’t apply, they have to cease operation and can not operate again until they apply and are approved,” Black said.
The bill’s intent is to give law enforcement better authority to go after unlicensed clubs, Black said.
While retail food establishments can apply for a marijuana hospitality license, employees would have to conduct that business in an isolated area of the building, Black said.
“It can’t be a food establishment that also has a liquor license, and [consumption clubs] would not be allowed to provide alcohol, tobacco or conduct activities that would require other marijuana licenses,” he said. “They are not prohibited from having those licenses at other locations — they just can’t participate in those activities at that site.”
In the event of an emergency, customers would have to stop all consumption activities while law enforcement or emergency personnel are on site, Black said.
“In all of this, we would certainly encourage best practices,” he said. “If somebody is intoxicated and you don’t think they’re safe, we’re going to hope that the clubs will help them get transportation home. People can be denied just like in medical and retail marijuana. … If somebody is violating the rules, they can be denied a license or a renewal, or they can have special terms put on their license and if they violate those, they can lose their license for that.”
While Black acknowledged this legislation might draw opposition from his Colorado Springs client base due to direct competition, the hospitality bill gives people an avenue to safely consume marijuana that they currently lack.
“It could be people who are visiting and have no place to consume, so although they can buy marijuana, they can’t take it back to their hotel. So they’re either consuming it in parks or vehicles or in the hotels when they shouldn’t be,” Black said.
“I think that when we look at it from a safety standpoint, it would be very important to have a location like a bar — if you want to go have a beer, you can drink responsibly.”